Startup Roundup: Xtreme Labs, Poynt, Squeeze and ‘Takin’ VC Money’
Matt Hartley and Christine Dobby | Sep 28, 2012 2:08 PM ET
In FP Tech Desk’s Startup Roundup series, we take a look at recent news from the Canadian startup world.
Chamath Palihapitiya buys majority of Xtreme Labs with his own funds
Toronto’s Xtreme Labs said Tuesday that Chamath Palihapitiya — a former Facebook vice-president and founder of the Social+Capital Partnership VC fund — has put up some of his own money to back the startup, which makes mobile apps for hundreds of customers.
I spoke with Mr. Palihapitiya, who is Canadian and a Waterloo grad, the next day. While the full acquisition price hasn’t been disclosed, he said he has put about $6-million or $7-million in now and has committed to spending another $20-million over the next three years in exchange for a majority stake in the company and will take over as chairman (Xtreme co-founders Amar Varma and Sundeep Madra will continue in their management roles).
From his vantage point in Silicon Valley, Mr. Palihapitiya said, it’s almost impossible to hire mobile developers and with the world increasingly heading in a mobile-first direction — on multiple platforms (iOS, Android etc.) no less — solid experience in that area is invaluable.
“At Facebook we had no problem recruiting the best and brightest but even still we faced this very obvious resource constraint,” he said, adding that he hired Xtreme to do work for the social media company and recommended the startup to several other businesses with mobile dev needs in the Valley.
On spending more time north of the border, he said: “I think guys like me who have more of a West Coast approach to risk-taking and risk tolerance and entrepreneurship being more involved in the Toronto ecosystem will be great.”
So you want to be a Googler?
Google Inc. is well known for snapping up startups, whether it’s to bring the team on board, make the product its own or both.
Worth reading on this subject is Ben Popper’s piece on The Verge from earlier this month, where he took an in-depth look at Google acquisitions over the past few years and spoke with many founders-turned-”Googlers,” including Illya Grigorik from Waterloo’s PostRank (acquired in 2011).
Given the company’s obvious interest in innovation, it probably isn’t surprising that it launched an annual Entrepreneur Week this year. It started last weekend and ran all week with 33 events in 28 cities around the world and Canada played host to two of them.
The first, on Wednesday morning, was run in partnership with Communitech in Kitchener, Ont. where nine startups took part in a general pitch session with Steve Woods (engineering director for Google’s Waterloo office), followed by individual mentorship sessions.
The second was a G+ hangout featuring a panel of Googlers who offered advice for budding entrepreneurs with audiences from Montreal’s Concordia University and the Schulich School of Business in Toronto tuning in.
Conversation with an early-stage investor
Also this week, I spoke with Barry Gekiere, the former venture capitalist who now manages the seed-stage Investment Accelerator Fund, which is backed by the Ontario government and operates out of MaRS in Toronto.
The fund invests a maximum of $500,000 in mostly pre-revenue startups in the IT software, cleantech and health science sectors and this week said it has made 57 investments in Ontario companies totalling $26.6-million since its inception in 2008.
Some notable portfolio companies include Top Hat Monocle, Axonify and Sweet Tooth.
“Institutional investors have abandoned this asset class totally,” Mr. Gekiere said, but he lauded moves by some wealthy individuals and angel investors to set up smaller boutique funds (Boris Wertz’s $15-million fund Version One Ventures in Vancouver comes to mind as a recent example).
“I’m seeing a vibrant community here in Toronto, Waterloo, Montreal. A lot of co-operation among the investors in the community,” he said. “There’s a good feel about this industry right now sort of at the grass roots level.”
Poynt gets a makeover
Calgary-based Poynt Corp., makers of the popular local search application of the same name, launched a new version of its iOS application this week, with a bunch of new features and a redesigned interface, known as “The Grid.” The new application includes a new “Like/Dislike” button so that user can upvote and downvote restaurant and business search findings, as well as a weather icon and a new location bar that enables users to change which area they are searching.
“With the integration of these new features, we have an app that iOS users can relate to and will want to use whether they are taking the time to plan a perfect date night or are in a rush to find a gas station,” Poynt chief executive Andrew Osis said in a statement.
Sequentia launches Squeeze
Toronto’s Sequentia has launched a new content marketing measurement platform known as Squeeze. Designed to determine just how well campaigns and branded content are performing on various online media channels, including Facebook, Twitter, and others, Squeeze is aimed at helping marketers optimize their budgets according to which pieces of online content are resonating with audiences.
“One of the biggest and most costly challenges that marketers face is the inability to determine if their content strategy is effective,” Sequentia founder and chief strategist Jennifer Evans said in a statement. “They need to understand if particular types of content are worth the time and cost investment to develop and implement.”
According to Ms. Evans, Squeezed is aimed at enabling marketers to measure and compare the reach of content across multiple channels, including email, corporate Websites and the social Web. With Squeeze, content can be tagged by time of day, theme or campaign, all with access to real time data.
Money, money, money
Finally, a bit of funding news from the past few weeks:
On Thursday, Calgary’s BeauCoo, raised $1.1-million in a seed round led by Zinc Ventures. The company’s platform is intended to “connect women of similar body types to share style and store information” and make the shopping experience easier. It is set for a mid-October North American launch.
You may remember one of BeauCoo’s four co-founders Cory Smith from his startup-focused track “Takin’ VC Money,” which he posted on Soundcloud performed at last year’s Grow Conference in Vancouver. The YouTube video is embedded below — and listen for lines like “You say ‘Exit,’ we say ‘Yes,’” and “3 a.m. whiteborads and lightbulb moments.”
On Sept. 20, Quebec City-based Crowdbase raised a $650,000 seed round, which CEO Albert Dang-Vu said he plans to use to keep building his product and hire (the team is currently at five people).
Chris Arsenault, managing partner at Montreal’s iNovia Capital (one of the backers in the round), called the company, which makes a corporate data management tool, “Yammer with a brain.”